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Also known as: blended cost, weighted average cost

Blended Rate

ConceptualFinanceMetrics

Definition

Blended Rate: Blended rate is the weighted average of different pricing tiers or cost structures. In startups, it often refers to the average equity ownership cost across multiple investors or funding rounds, or the combined cost of different services.

Example Usage

β€œOur blended CAC across all channels is $50, though paid ads are $80 and organic is $10.”

Common Misconceptions

Blended rates are straightforward averages. They must be weighted by volume or amount.
Lower blended rates are always better. Understanding individual components matters more.
Blended rates are static. They change as the mix of inputs changes.

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